770 jobs under threat as ad revenues decline: Trinity Mirror

770 jobs under threat as ad revenues decline: Trinity Mirror

	Published : Wed, 19 Oct 2005 13:05 By : Amy Watts Print this Story

LONDON: Trinity Mirror PLC, publishers of the Daily Mirror today told unions it was considering cutting up to 770 of its 11,000 jobs as the downturn in advertising revenues was expected to continue in the next year.

The publishing group said it sought to cut costs and maintain profit margins for which it was considering various “possible actions to support our business, which may include redundancies”.

Advertisers, particularly of branded products, were slashing annual marketing budgets even further following the slowdown in consumer spending and sharp declines in the property market. This increased pressure on the publishing group who recently reported a 5.5 percent drop in advertising revenues at the Daily Mirror and other national titles.

In contrast, its regional titles fared better with a 1.5 percent rise in advertising revenues. Regional titles rely heavily on advertising revenues which contribute as much as 80 percent to total earnings, whereas in national newspapers it contributes as much as 40 percent. In its national newspapers the group gets 27 percent of its revenues from classified adverts and 30 percent from display advertising.

The publisher’s staff received a briefing note warning of significant reductions in classifieds and recruitment advertising; clients were also cutting back on display advertising in order to maintain profitability.

Members of the National Union of Journalists were told the company might have to cut 5 to 7 percent of its overall workforce.

For the group’s chief executive Sly Bailey, this could be the second round of job cuts since he took on the job two years ago. His previous effort - the “stabilise, revitalize, grow” programme involving 550 job losses - is still fresh in the memory of the staff.

The management also sought to explain that the industry was facing tough trading conditions due to the slowdown in advertising markets. If the job cuts were deemed essential the management would first seek voluntary redundancies, but some executives said compulsory job cuts cannot be ruled out if the company were to shed the required number of jobs.

Meanwhile, the Union has reacted sharply to the publisher’s statement calling it “an incredibly short term reaction” to various economic factors such as the declining property market.

The group is the largest regional publisher in the UK owning 240 regional titles and 5 national titles. These include People, the Liverpool Echo, the Racing Post and the Birmingham Evening Mail, among others.